I’m constantly striving to present you, my readers, with the information and advice you need most. It’s with that goal in mind that I’m creating an additional blog format – one in which inventors will be able to submit specific questions that I’ll answer to the best of my ability. I’m hoping this new format will help you better understand when and how to apply my advice and strategies – the real life scenarios should, at some point, sound a lot like your own! Here’s the first.
K. Kornaker has designed a medical product that is currently patent pending. She has found a manufacturer that she is currently negotiating a technology license with. She asks: Is it reasonable to ask for upfront money (money that would cover the time and personal finances invested during the patent process and research conducted over the past years)? Additionally, is it wise to license the product to a manufacturer and a company that would sell the product?
Yes, asking for an advance is a sound idea. It shows good faith on the part of the company – if a company is receptive to the idea of paying you an advance, you can be assured that they’re in it for “the long haul”. But you must be careful not to top load the deal. Essentially, don’t ask for too much. An intelligent approach would be to ask them to pay for your patents, as well as any improvements made in the future (there WILL be improvements made). It is absolutely crucial that you insert a clause into your contract that you, the inventor, own any and all improvements, always.
No, you should not (and really, wouldn’t ever) license to both a manufacturer and additional company; a single company should be in charge of overseeing the manufacturing and selling of a product (regardless of that specific company is actually doing the manufacturing themselves). You can’t double dip with licenses, unless a contract with a company specifies that your product is sold in a limited number of markets (such as international, small-scale retailers, etc). In that case, you could pursue a license with another company that didn’t conflict with the parameters of your first contract.
InventRight: Helping You Bring Your Product to Market